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Draft Regulation of Trust Bill 2026
- 19 August 2026
- Miscellaneous
- South African Accounting Academy
Summary:
The Department of Justice and Constitutional Development (DoJ & CD) has published the draft Regulation of Trust Bill, 2026 (to modernise trust legislation), for public comment.
Article:
The Bill seeks to modernise the legal framework for trusts by replacing the outdated Trust Property Control Act, 1988.
It aims to strengthen accountability and compliance, enhance the oversight role of the Master of the High Court and provide greater protection for beneficiaries.
Key/Primary Legislative Objectives: (as identified by the South African Government)
- Modernising the framework: Overhauling archaic structures to align with international standards set by the Financial Action Task Force (FATF).
- Strengthening compliance: Curtailing the misuse of trusts for illicit financial flows, tax evasion, or terrorist financing.
- Enhancing oversight: Boosting the monitoring capabilities and risk-assessment powers of the Master of the High Court.
- Protecting beneficiaries: Establishing rigorous safeguards for vulnerable beneficiaries, such as individuals awarded legal or medical damages.
4 Major Impacts on Family and Business Trusts: (as outlined by legal practitioners, regarding several critical operational adjustments that ordinary trusts will face):
- Compulsory Financial Reporting: Trustees will be legally required to prepare annual financial statements and retain all transaction records for at least five years after they step down.
- Mandatory Annual Returns: Trusts must submit an annual return alongside a prescribed filing fee to the Master of the High Court.
- Personal Trustee Liability: Non-compliance will be initially met with compliance notices and administrative fines. Crucially, trustees must pay these penalties out of their own pockets and cannot recover the costs from trust assets.
- Restrictions on Amending Deeds: Trustees will be blocked from making amendments to their trust deeds unless all beneficial ownership details are fully updated and lodged with the Master.
New Investment and Resignation Rules: (newly introduced specific, codified statutory requirements to formalise governance)
- The "Prudent Investor" Standard: Clause 16 stipulates that trustees exercising investment powers must act as a prudent investor would. They must formally evaluate a statutory checklist of 15 criteria, including investment diversification, real capital value preservation, taxation impacts, and fee costs.
- Formal Resignation Procedures: A trustee can only resign via signed written notices delivered to remaining trustees, beneficiaries, and the Master. The resignation only takes effect once the Master issues a formal written acknowledgment.
- Official Trust Dissolution: A trust will not be considered legally terminated until the Master of the High Court officially removes it from the central trust register.
Comments are due by 11 September 2026.
Click here to download the 44-page Draft Bill:
https://www.justice.gov.za/legislation/invitations/20260807-gg55166gon4088-RoT-Bill%202026.pdf
Relevance to Auditors, Independent Reviewers & Accountants:
- The Trust Property Control Act 57 of 1988, and General Laws (Anti-Money Laundering and Combating Terrorism Financing) Amendment Bill are yet more pieces of legislation that your clients must comply with, and which you must assess compliance with. If they don’t comply with the relevant laws and regulations, you have certain reporting obligations in terms of NOCLAR (NOn-Compliance with Laws And Regulations) – this could include reporting to management, qualifying your audit opinion, reporting a Reportable Irregularity, etc.
- As an auditor, independent reviewer and accountant who has trusts as clients, you need to consider whether trustees are complying with the latest requirements, as required.
- If you are advising your trust clients and trustees, you need to be aware of the latest information, tools, templates and directives that have been issued by relevant regulators, e.g. the DoJ&CD and the Master’s Office.
Relevance to Your clients:
- All Masters and Trustees have certain obligations that must be fulfilled, as required by the latest legislative changes.
- Your clients need to be aware of the latest information, tools, templates and directives that have been issued by relevant regulators, e.g. the DoJ & CD and the Master’s Office.